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Ferrisburgh closer on VGL deal

FERRISBURGH — The town of Ferrisburgh and the Massachusetts companies proposing the $650 million, 400-megawatt Vermont Green Line (VGL) — Anbaric Transmission and National Grid — could strike a deal at any time to pay the town for hosting about 5.5 miles of underground power cable between Lake Champlain and on Route 7, according to the head of the committee dealing with the VGL firms on the town’s behalf
Craig Heindel, chairman of the committee the Ferrisburgh selectboard appointed to research VGL issues and negotiate with the VGL companies, said town officials made a mid-June counteroffer to the first VGL proposal and are waiting to hear back.
“We hear from their lawyer they’re working on it,” said Heindel, also the Ferrisburgh Conservation Commission chairman.
He said VGL executives plan to file with the Vermont Public Service Board by Aug. 18 for a Certificate of Public Good for the project, and that it might make sense for them by that point to have a deal, called a Host Town Agreement, with Ferrisburgh in hand or in the works by then.
“I would think they would want to file an application with the Public Service Board that includes a completed and signed Host Town Agreement,” he said, although he also noted that other similar utility projects have not always wrapped up such agreements before filing with the PSB.
At a November meeting in Ferrisburgh, VGL representatives said they would pay the town at least $350,000 a year for 20 years for allowing the power line to be buried in town road rights of way. That money would be on top of what they said would be about roughly $150,000 in annual local property taxes the project would pay.
They also left the door open for further talks on a Host Town Agreement, which as well as direct payments would also cover such issues as how the underground cable installation will handle culverts, where the line will cross town roads, what construction techniques will be used, how affected land will be landscaped and restored, and how easement language will be written.
Heindel said town officials consider construction design and its impact on Ferrisburgh infrastructure to be critical. Those are also financial issues, he said, because if something goes wrong with the roads or related improvements due to the power line, officials want to “make sure we have enough in the kitty so that if we do have to spend money on road repairs there is money available.”
OFFERS AND ACCEPTANCE
Details of the Host Town Agreement negotiations are confidential, but Heindel talked in general terms and compared VGL’s first offer to what was represented in the public meeting. 
“It was somewhat similar,” he said. “It was in the same range, but the financial offerings were structured differently.”
Ferrisburgh officials countered with an offer that Heindel said they believe is reasonable.
“They’re different in the dollar values. Then there are some other technical issues like insurance requirements and so on. But I imagine the holdup on the part of VGL is their consideration of our dollar request,” Heindel said. “We think it’s a bridgeable difference.”
If that offer is accepted, or VGL makes an offer the selectboard eventually deems acceptable, Selectboard Chairwoman Loretta Lawrence said the board itself will make the decision to sign it without a public vote.
Selectboards have the power to sign contracts such as these, Lawrence said, although New Haven, where the issue generated more controversy due to the installation of a converter station and the existence of a VELCO substation, did hold a townwide advisory vote.
Lawrence said in June the selectboard decided not to call for such a vote. She said town officials’ efforts to discuss the issue publicly and place information on the town website have kept residents in the loop, and that the board itself is “capable of making the decision” because of its own research and the work of the committee.
“We feel people are informed, and the selectboard is qualified to make the decision, based on working with the committee and legal counsel.” Lawrence said.
PROJECT DETAILS
The VGL is intended to bring hydro and wind power from upstate New York by cable under Lake Champlain and into the New England power grid via the converter station in New Haven.
Plans call for bringing the line into Lake Champlain from Beekmantown, N.Y., and then to Ferrisburgh at Kingsland Bay. From there it would run underground in a two-foot-by-four-foot concrete box along Kingsland Bay, Sand, Little Chicago and Botsford roads and Tuppers Crossing on the way to Route 7. Junction boxes, about 120 square feet, will be needed along the road about every 2,500 feet to hold line splices.
The VGL companies have already agreed to pay Ferrisburgh’s legal fees and costs of analyzing the construction plans and evaluating the VGL property for tax purposes; they placed $40,000 in an escrow account for those purposes.
Officials in New Haven this spring agreed with the VGL companies on a deal that includes $1.4 million a year for 40 years, plus $4 million toward a new fire station and town garage.
Among the VGL information on the Ferrisburgh town website are an analysis of the potential impact of electric and magnetic fields (EMFs) generated by the project, a memo on the impact of the underwater line on Kingsland Bay moorings and Lake Champlain fish, and a study of the property tax impact of the project in Ferrisburgh.
On EMFs, a study concluded the “calculated total static magnetic field (cable plus ambient geomagnetic) in the vicinity of the VGL cables on land is far below the ICNIRP standard for human exposure to static magnetic fields.”
The Kingsland Bay memo concludes the power line will be buried far enough below the lake bottom so as not to interfere with moorings, nor will the line harm fish.
The tax study examined the VGL property tax projections for the municipal portion of tax bills only. It dealt with two scenarios:
• If “Municipal spending … but does not increase because of addition of The Green Line to the grand list,” the VGL would generate an increase in taxes that would range from $129,505 in 2020, when the project is targeted for completion, to $134,944 in 2030.
• If municipal spending does increase, the tax benefit would yo-yo, according to estimates, starting at $144,558 in 2020 on completion, rising to $153,379 in 2032, declining gradually due to depreciation to $102,322 in 2050, and then rising again to $143,278 in 2060.
That revenue would be in addition to compensation agreed upon in the Host Town Agreement.
Heindel said the expert who evaluated the VGL figures concluded the valuation, and thus the taxes, “seems to be supportable in the early years.”
But Heindel said there is some question about how the underground cable would be valued through depreciation, leaving room for a different approach in later years that could boost tax numbers.
“If it has a 40-year life, in year 39 it has almost no value, and yet there are still zillions of electrons zinging down that cable making lots of profit,” he said.
Another issue raised by the town’s expert is that the VGL’s estimate of a $52,000 expense in Ferrisburgh seems to be about 50 percent of similar costs elsewhere, meaning the tax estimates could be low.
“An underestimation of the construction costs would result in an underestimation of the forecasted future real property tax revenue the Town of Ferrisburgh can expect to receive due to the construction of the VGL project,” the report reads.
Regardless, Heindel said the committee found no cause for concern in any of these reports, and the focus remains on negotiations on the Host Town Agreement.
He said talks have been productive and friendly, but slower in the past three months as VGL has dealt with New Haven, talked with state officials about Kingsland Bay and Route 7 rights, and focused on the PSB application.
Ferrisburgh’s turn could be soon, though.
“I’m watching my email,” Heindel said. “Every time something pops in, I’m wondering if that’s the one.”
Andy Kirkaldy may be reached at [email protected].

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